TMX offers access to dark liquidity

Canadian exchange group TMX has added two new order types that will enable users to access both lit and dark liquidity on its Toronto Stock Exchange (TSX) and TSX Venture Exchange (TSXV) trading venues.

The new order types consist a dark mid-point and a dark limit order, both designed to interact with visible and other non-displayed orders. Initially offered on a limited number of TSX and TSXV symbols, they will be gradually introduced across all stocks listed on the two exchanges. TMX had previously planned to launch the non-displayed order types on 1 March.

“TMX Group is pleased to offer our customers additional trade execution choices with these two order types,” said Robert Fotheringham, senior vice president, equities trading at TMX. “We are certain that market participants will benefit from the integration of dark liquidity with Canada's most extensive displayed order book.”

TMX claims that the new order types will allow participants to reduce execution costs, receive price improvement and benefit from efficiencies in accessing both dark and visible liquidity through a single destination and transaction.

The group has stated that further enhancements for participants using TSX and TSXV dark order types are scheduled for Q2 2011. TMX is also planning to launch its own alternative trading system TMX Select, focused on high-frequency traders, in June this year.

TMX is currently working towards a “merger of equals” with the London Stock Exchange Group. Initially announced in February, the deal would see LSEG shareholders gain a 55% stake in the new merged entity. The agreement remains subject to regulatory approval in Canada.